Crypto exchange Gemini denies involvement in Terra (LUNA) price drop

Now that the smoke has cleared around Luna, it’s time to point fingers. Who hit the first domino? Rumors have it that BlackRock and Citadel borrowed 100,000 bitcoin to bring down Luna. But Gemini is now debunking that rumor.

No loan

Gemini is a well-known crypto exchange from America, founded by the Winklevoss brothers in 2015. Perhaps this (last name) rings a bell – Cameron and Tyler Winklevoss are also known for the lawsuit against Facebook in 2004.

Back to the present, because now the crypto market is turning against the Winklevoss brothers. It is rumored that Gemini has cooperated in a bitcoin loan worth $2.8 billion to bring the price of Luna down. Among others, asset manager BlackRock and hedge fund Citadel would be involved.

The story goes that both parties have borrowed 100,000 bitcoins together. Later they would have exchanged 25,000 bitcoin for UST, the stablecoin of the Terra ecosystem. Shortly afterwards, these parties would have sold both bitcoin and UST. As a result, UST lost its peg to the dollar and LUNA fell sharply in value.

Gemini denies

But are those rumors true? Gemini vehemently denies, a recent tweet from the official account shows: “We are aware of a recent story that suggested that Gemini had provided a 100K BTC loan to major institutional counterparties, which reportedly resulted in a selloff in $LUNA. Gemini has not taken out such a loan.”

Whether the rumor is true or not, the damage is immense. At the time of writing, LUNA is moving around $0.03. In just a week, the coin lost a staggering 99.9% of its value. You can see that clearly below on the weekly chart of the infamous crypto.

Last Wednesday, Do Kwon, the man behind Luna and UST, came with a recovery plan for both cryptos. Time will tell if he can turn the tide.

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